The latest RICS Residential Market Survey indicates a continued weakening in UK housing market activity as of November, with buyer demand, property listings, and sales all showing declines. This trend follows the Autumn Budget, where political uncertainty and new tax measures have dampened confidence, particularly affecting landlords and the lettings sector.

Overview of Market Conditions Post-Budget

According to the RICS survey, the UK housing market experienced a further slowdown in November. Agents reported falling buyer demand, fewer new property instructions, and sluggish sales activity. The period leading up to the Autumn Budget was marked by political noise and leaks, which contributed to households remaining cautious and hesitant to engage in property transactions.

For landlords, the lettings market is also showing signs of strain. Landlord instructions remain negative at -39%, reflecting a reduction in properties being offered to let. This decline is partly attributed to the new income tax on property announced in the Budget, which many respondents believe presents an additional barrier to investment in rental properties.

Tenant Demand and Rent Price Expectations

Tenant demand has cooled significantly, with the net balance dropping to -22%, the lowest level since April 2020. Despite this, near-term rent price expectations remain positive at +6%, suggesting only marginal increases in rents over the coming months and an anticipated 2.5% rise in 2026. This indicates that while demand is softening, rental prices are expected to hold relatively steady, supported by a shortage of available rental stock.

Simon Rubinsohn, RICS’s chief economist, commented on these trends: “In the lettings market, although tenant demand does appear to be softening, the lack of stock is keeping rental expectations elevated and the additional tax levied on landlords in the Budget will likely exacerbate this trend.” He emphasised that affordability challenges and elevated borrowing costs will likely keep market activity subdued in the near term, despite some optimism for the year ahead.

Buyer Enquiries and Sales Outlook

The survey highlights a sharp decline in new buyer enquiries, with a net balance of -32% in November, a steeper fall compared to October’s -24%. This represents the weakest reading for buyer interest in 2023. Agreed sales figures remained low at -23%, consistent with the previous month’s -24%, indicating a persistent downbeat sales trend throughout the autumn.

Looking ahead, the near-term sales outlook has worsened slightly, falling to -6% from -3%. However, agents are more optimistic about 2026, with a net balance of +15% expecting sales volumes to increase, up from +7% in the previous month. This suggests that while the immediate market remains subdued, there is cautious hope for improvement next year.

Supply Constraints and Price Movements

New property listings continue to decline, with a net balance of -19%, closely matching October’s -20%. Appraisal levels have also fallen for four consecutive months, with a net balance of -40%, signalling a weak supply pipeline as winter approaches. Nationally, prices are softening, registering a net balance of -16%, while London has seen a sharper decline, dropping to -44%.

Market Sentiment and Political Impact

Tom Bill, head of UK residential research at Knight Frank, noted that the period of speculation over property tax before the Budget had a negative effect on buyer and seller sentiment. He expects that with the Budget now clarified, existing transactions may accelerate before Christmas and that activity could remain relatively strong in early 2026. However, he warns that political uncertainty remains a key risk, particularly with upcoming local elections potentially influencing market confidence.

Implications for Landlords and Agents

For landlords, the combination of new tax measures and softer tenant demand suggests a cautious approach to investment and portfolio management may be prudent. The ongoing shortage of rental stock supports rental price stability, but the additional tax burden could deter new investment. Letting agents should be prepared for a market with reduced instructions and tenant enquiries, while also monitoring potential shifts in demand as interest rate expectations evolve.

Landlords and agents may benefit from staying informed about market trends and government policy changes to navigate this challenging environment effectively.

Looking Ahead: Trusted Partners Hub Launch

The Landlord Association (TLA) is launching a new Trusted Partners Hub in Q1 2026. This platform will feature verified and approved service providers selected to support landlords, tenants, and property management businesses. Service providers in legal, trades, insurance, financial, mortgage, tenant screening, and other relevant sectors are invited to register their interest at landlordassociation.org.uk/become-a-tla-service-partner/. This initiative aims to provide landlords with reliable resources to manage their properties efficiently amid evolving market conditions.